1040 Spawn Pl

Wendell, NC 27545

$269,900D

3 bd · 2.0 ba · 1,026 sqft · Built 1996 · SingleFamily · Pending · 82 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,057/mo
• Mortgage (P&I): −$1,415
• Tax + insurance: −$234
• HOA: −$10
• Vac / Maint / Mgmt: −$432
• Net cashflow: $-34/mo
• Annual: $-412/yr
• Cap rate: 6.14%
• Cash-on-cash: -0.54%
• DSCR: 0.98
• 1% rule: 0.76%
• Cash to close: $75,572

Investor read

• This is a 3-bed/2.0-bath single-family listed at $270k.
• At list price, monthly cash flow is $-34 ($-412/yr) — negative.
• To cash-flow at today's rent, offer at most $264k (2.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $206k (23.8% below list).
• It's been on market 82 days — a 6% lower offer ($254k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $206k (23.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#25 in NC, #2,391 nationally) — a middle-class / working-renter tenant base. Strengths: housing A+, health & safety A+, crime A; Watch: amenities D.
• Wake County Schools (suburban): math 52% / reading 60% proficiency, ranked #35 of 178 in NC (top 20%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Lake Myra Elementary (math 23% / reading 35%, grade F, #1,007 of 1,410 statewide, top 72%, 648 students, 55% FRL); Wendell Middle (math 21% / reading 39%, grade F, #335 of 475 statewide, top 72%, 719 students, 68% FRL); East Wake High (math 51% / reading 44%, grade D, #331 of 535 statewide, top 62%, 1,646 students, 62% FRL) — zoned schools average 62% FRL vs 30% district-wide (31 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 36% at this address vs 56% district-wide (-20 pts) — the specific schools serving this property underperform the Wake County Schools average; the district grade overstates school quality for this exact location.
• Market conditions: Rents soft (-1.4%/yr); 406 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 15,249 units permitted in Wake County in 2024 (5,568 in 5+ unit buildings).
• Wake County population projected at +51% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 20y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $194k; 39% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: major wind risk, 58% chance of damaging wind over 30y; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.1% vs local median 3.7% in Wendell — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 82 days. Have you received any prior offers? Is the seller open to a 24% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.